New Portfolio for the new year

Podcast Duration: 08:37

Endings and beginnings are very fascinating - especially of new months and years. Doston new year ki occasion pe kai log naye resolutions form karte hain, lekin only few of them think about their own financial portfolios. In fact, jis time par log apne-aap mein naye habits dekhne ke liye aur apne past dreams ke success ke liye plan karte hain, wahan par apne financial portfolio par dhyan dena bhi utna hi essential hai.

Well, if you are wondering ki why you should consider rebuilding your portfolio at the end of the year, then don’t worry - we will come to that too. But before that, think about the past year in a flash - so many things have happened - the pandemic hit, markets were disrupted, and the stock market saw new gainers and losers. Your portfolio might have performed well, and you might be reluctant to undertake such a demanding activity at the onset of the new year. Lekin you must also consider another factor into account - new benchmarks were set, the definition of stability changed for most businesses, and recovery was strong too.

In such a situation, revising your financial portfolio at the beginning of a new year is a good idea. Portfolio revision se aap apne funds ke performance aur risk exposure ko better pinpoint kar sakte ho - because now you can take a look at your portfolio performance over a long run. Isn’t that exciting? I bet it is. But what’s more exciting, is to realign your expectations from your portfolio to the actuals, and understand your new financial goals, now that another year has passed in your life.

Kya aap apne retirement ke kareeb pahunch rahe hain? Or are you eager to buy your first house, or a new car? With the passing of another year, you are nearing newer milestones in your life. Kya aapka portfolio in goals ko realise karne ke liye best aligned hai? If not, then here is another incentive for you to revise and build a new portfolio for the coming year.

1.First, focus on your goals - kya aap apne predefined life goals ke kareeb pahunch rahe ho? Were you planning to build an emergency fund by 2021? Or perhaps, moving to a different city, or buying a vehicle or property? Now that the year has passed, many things might not have gone the way you wanted them to. Understand what is feasible, aur ye samajhne ko koshish karen, ki which priorities will take precedence on your personal milestones agenda.

2.Next, in goals ko apne naye portfolio ke parameters se link karen. Understand the relation between your goals, and how they can materialize into reality with your portfolio. For example, moving to a different city might not be possible right now, and ho sakta hai ki 2020 mein aapke life experience se naye goals emerge huye hon. Now think about how these goals will require a new financial plan - kya aapki risk appetite pehle ke comparison mein reduce hui hai? Or are you looking for greater growth? Think about these factors, write them down, and research about how other people are achieving their financial goals.

3.Friends, is exercise ke baad apko 2 crucial insights zaroor milenge - these are: your new growth expectations, and your risk appetite. Once you understand this, its time to shift focus from inwards to outwards. Doston, markets never stay in the same state and shape - change is the only constant. Despite a good degree of experience in the markets, 2020 was a learning experience for many, kyunki stability, risk aur growth ki equations mein significant changes dekhne ko mile. Jo stocks previously stable aur high growth consider kiye jaate the, they were outperformed by new sectors. In fact, business ke sabhi sectors mein large scale change dekhne ko mil raha hai. Ab retail ka example hi le lijiye - how many people are shopping for groceries from small shops in cities and mid-sized towns? In new factors ko apne market ke analysis mein shaamil karna bahut zaroori hai.

4.Once you have an idea of how the market performed this year, it is time to build your portfolio by selecting the right instruments and picking the right securities. If you are revising your portfolio, you will already be familiar with this process. But if you are starting from scratch, the process remains more or less, the same - that is, focus on a few sectors, crunch the numbers, and do a solid qualitative and quantitative study of the instruments that make it to the top.

Toh doston, these are a few things that you can consider while building a new portfolio for the coming year. Lekin abhi main discussion toh baaki reh gaya hai - can you guess what that is? 2021 ki baat karte hue, how can we not talk about the new trends that might be seen in the markets in the coming year? That’s right - doston, now we are going to look at some of the trends that markets will witness in the coming year:

1.2020 mein risk management systems mein naye changes dekhne ko mile. Going forward, low risk appetite investors will show a greater preference for cash positions rather than derivative positions. Coronavirus ke baad jab markets first time plunge hue, sensex lost almost 4000 points. Many derivative positions suffered, and diversification strategies were put to test - while such disruptions are rare, 2020 has taught an important lesson on risk.

2.Sector rotation patterns mein ek significant shift dekhne ko mila - in 2020, despite the rifts that hit the market, some sectors not only outperformed the markets, but also achieved record growth. This year, some of the top gainers were from FMCG, Technology, Pharmaceutical and Banking and Financial Services. Lekin, not all these sectors moved concurrently. Sector rotation par 2021 mein newfound focus dekhne ko milega, and those who understand sector rotation well will discover new opportunities for short and medium term growth.

3.Predicting price bottoms and tops will become more complicated, lekin timing will be the key to making the most out of your investment. 2020 mein kai investors ne bottoming stocks ko sahi time par purchase kiya, lekin they sold too early. Timing will become more important even as the pandemic recovery strengthens the economy - because recovery will also come with new gainers, sector rotations and growth waves.

4.Focus on sectors that lost in 2020. Recovery ke dauraan these the reliance on these core components of the economy will build momentum, and purchasing them as they are bottoming out will be the key to making the most. In fact kuch sectors jaise retail, PSU aur FMCG are already starting to show signs of recovery.

5.Keep an eye out on the performance reports of the fourth quarter, kyunki this will help investors understand the performance of stocks over the entire year. For example, Zoom jaisi companies, jo remote work enablers hain, are already starting to see divestment as people start commuting to physical offices. Aud doston, ek baat na bhoolein - strong companies perform well despite bullish, neutral or even bearish conditions. On the other hand, weak performers perform badly no matter how bullish the market. Ye samajhna ki kya apne portfolio mein include na kiya jaaye, will be easier than understanding what to buy. Isliye, watch out for the reports on the 4th quarter, review and understand top performers and strong gainers with a birds eye view on the timeline of growth.

6.And lastly, don't confuse strong performance with buy signals! Going forward, sectoral performance ko economic recovery ke context mein dekhna crucial hoga. Isliye, is samay par economic puzzle mein sabhi sectors ka role samajhne ko koshish karen. This will give you a good idea of which sectors to stay away from. Saath hi, some sectors will emerge as new sources of stability for your portfolio - these will be the new diversification tools that keep your funds growing.

Toh doston, these were some of the trends that will decide the shape of a good, high performing portfolio for the coming year. While the basics of the game will stay the same, 2020 ke experience ko review karna na bhoolein, because there was a lot to learn from the growth and decline patterns that were recorded in the markets.

What is your 2021 portfolio going to look like? Discover more on how to build a solid portfolio for the new year on